News roundup: Small RIAs are booming, a millennial advisor’s path to independence, and experiencing ‘faux-tirement’

Who says small RIAs aren’t making it? Financial Advisor magazine analyzed more than 600 firms and found that some of the fastest growers have less than $200 million in assets. One firm, which focuses on small and mid-sized retirement plans, grew by 175 percent in 2016. Read the details below. Also, in a separate article in Financial Advisor magazine, tech guru Joel Bruckenstein describes three smaller custodians in the industry that offer advisors innovative, integrated technology platforms (even robo-advisors, if desired): RBC Advisor Services, Trade PMR, and Shareholder Service Group. “In every case the results are impressive,” Bruckenstein notes. See his column below.

Small RIAs Show Explosive Growth

By Karen DeMasters

Source: Financial Advisor

Despite the talk of small financial firms folding or being absorbed by huge conglomerates, many small firms are thriving and growing. Some of the fastest-growing firms in the nation have less than $200 million in client assets, according to an analysis conducted by Financial Advisor magazine.

Over the last several years, there’s been intense competition among the major custodians to provide the most robust technology platform to financial advisors. Even non-custodial firms are now vying to become platform providers of choice—firms such as Advyzon, Black Diamond, Envestnet, Morningstar and Orion. With all the attention the big names in the industry get, it is understandable how the innovations of smaller custodians get overlooked. That’s a shame, because some are offering better tech experiences for advisors to give to clients—digital on-boarding, risk assessment tools, account aggregation and client portals. Or even robo-advisors, if clients want them.

In an excerpt from “The Millennial Money Fix,” author Douglas Boneparth describes how he worked for numerous financial firms (including his father’s) before taking the entrepreneurial leap of launching his own wealth management firm. “Eight years of training, education, patience, hustle, negotiation, compromise, success and failure. And this is only the beginning,” he writes. He focuses on millennial clients. The book excerpt is at InvestmentNews, below.

How millennial advisers can foster the entrepreneur within

By Douglas A. Boneparth and Heather J. Boneparth

Source: InvestmentNews

“Like generations before us, millennials have an entrepreneurial spirit. What separates us is our ability to harness technology to be more productive; to achieve more in the same time given. Some millennials discovered their entrepreneurial identity when their advanced degrees didn’t align with the demands of the job market. Unemployed or underemployed, they didn’t have a choice but to set out on their own. Others found traditional corporate roles to be bureaucratic, archaic and infuriating. Even more felt like they were doing just fine, but weren’t happy.”

Oregon has launched an “auto-IRA” program for private-sector workers, the first state to do so, reports InvestmentNews. The program will roll out in phases, beginning with larger employers in early 2018, according to the publication. Four other states have passed laws to create similar plans. See the full story below. Also, a six-week break from work gave Morningstar’s Christine Benz a chance to contemplate what “real” retirement could feel like – pros and cons. She lists several takeaways from her “faux-tirement,” including the fact that her powers of concentration improved and that she missed her work “family.” Her column at Morningstar follows.

Oregon becomes first state to launch auto-IRA program

By Greg Iacurci

Source: InvestmentNews

Oregon has become the first state to launch an automatic-enrollment, payroll-deduction IRA program, known as an “auto-IRA,” for private-sector workers. It brings to fruition a concept that’s been discussed among policymakers for more than a decade, and represents a shot of sorts at the Trump administration.

I’m not ready to retire any time soon, but my recent sabbatical from Morningstar–a six-week break totally free from work obligations, available to Morningstar’s U.S. employees every four years–gave me a chance to noodle on what retirement would feel like for me. Of course, there were some crucial differences relative to an actual retirement: I continued to get paid (nice work if you can get it!), and I knew I was going back to my job when my six weeks were up. In addition, my husband and I took a trip for a couple of weeks, so my true “faux-tirement” observation period was really just a month. But after years of researching and writing about the financial side of retirement, my break gave me a sense of the lifestyle aspect of not working.